Markets are bracing for the impact of Trump's sweeping 104% tariffs on Chinese imports, which are set to take effect at 12:01 a.m. Wednesday US Eastern time—just minutes away. Earlier hopes for a last-minute phone call from Beijing to delay implementation faded as the deadline approached, assuming there was ever a serious prospect for such a move.

US equity index futures declined sharply, falling as much as 2% before stabilising. The Australian and New Zealand dollars were also hit, each dropping to their lowest levels since 2020 amid rising geopolitical and trade tensions.

Adding to the tariff narrative, Trump signalled that his long-promised tariff on pharmaceutical drugs would be “major” and is expected to be announced “very shortly.”

In Japan, Bank of Japan Governor Kazuo Ueda struck a cautious tone, saying the central bank remains in wait-and-see mode to assess the broader impact of the tariffs. Meanwhile, Japanese officials are reportedly heading to Washington for direct talks on trade measures.

All eyes were also on the People’s Bank of China’s daily USD/CNY reference rate, with the central bank guiding the onshore yuan lower to its weakest level since September 11, 2023, subtly allowing pressure to build on the currency.

Elsewhere, the Reserve Bank of New Zealand cut its official cash rate by 25 basis points, in line with expectations. In the FX space, EUR/USD climbed to briefly trade above 1.1040, while AUD and NZD rebounded from their earlier lows. GBP/USD also advanced. USD/JPY dipped below 145.25 before recovering back above 145.90.

US yields continued their climb.

Regional equities remainder under pressure.

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After midnight (US time) CNH is likely to see pressure again:

usdcnh 09 April 2025 wrap 09 April 2025 2
Source: Forex Live